What Is Lead Scoring? What Is Lead Scoring?
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1 What Is Lead Scoring? What Is Lead Scoring?
2 Table of Contents Context: Answering an Important Marketing Question How Lead Scoring Works...3 How Does a Business or Organization Benefit from Lead Scoring?...4 The Marketing Qualified Lead (MQL) Lead Management Software What to Look for in a Lead Management Tool What Is Lead Scoring? In business, not all leads are created equal. Some will be red-hot and demand prompt attention; others will be lukewarm and may need nurturing before they can be actively sold. Then there are those people just too early in the information-gathering phase to consider them sales-ready leads. The big problem is separating the hot from the not business leads. It can be time consuming and, if not handled correctly, a bit of an inexact science that may result in lost opportunities. That s where lead scoring comes in. In very basic terms, lead scoring is an objective system for ranking leads to determine which ones are ready to convert immediately, which ones need further nurturing, and which ones are highly unlikely to buy. In other words, lead scoring helps you determine which leads are hot and which leads are not, allowing your sales and marketing teams to put their efforts into the best opportunities for revenue generation. An automated lead scoring system is a rules-based process that takes into account the online behavior of your sales prospects. Actions like opening an , filling out an online form, attending a webinar, visiting your website, or clicking a link add to a lead s overall score. The higher the score, the more probable it is that a lead will convert. Lead scoring ensures that the best leads are passed on to your sales team and prioritized based on revenue potential and buyer readiness. Context: Answering an Important Marketing Question A great deal of marketing revolves around a question that is not always asked out loud but is at the heart of many marketing campaign decisions: Who is worth an investment of resources? Marketing budgets are finite. The bandwidth of both Marketing and Sales teams is limited; therefore, it s important to know: 68% 50% 77% LEAD SCORING STATISTICS 68% of successful marketers cite lead scoring based on content and engagement as most responsible for improving revenue contribution. Source: The Lenskold and Pedowitz Groups Companies that excel at lead nurturing generate 50% more sales-ready leads at 33% lower cost. Source: Forrester Research Organizations that use lead scoring experience a 77% lift in lead generation ROI, over organizations that do not use lead scoring. Source: Marketing Sherpa Which prospects deserve focus and expenditure of time or financial resources? Which leads will pay back the marketing investment by generating revenue or taking other desired actions, such as donating to a nonprofit organization? Lead scoring is a tool that marketing and sales teams can use to determine which prospects are worth the effort to follow up. 2
3 What Is Lead Scoring? A lead qualification process is one of the basic features of a good marketing automation platform. sales funnel and give your marketing and sales teams a clear path to accurately identify the hottest leads and focus on prospects that need more information and attention to convert. How Lead Scoring Works To understand lead scoring, first assume that a sales lead has been captured in a marketing automation (or lead management) system. The lead record contains the lead s name, company, address, , phone number all pretty basic information. At that point the lead is little more than a name. You don t know if he or she is worth another second of anyone s time or a penny of additional marketing resources. Their score is 0. Now, imagine that lead visits your product web page. This action reflects some potential buying interest. As a component of a marketing automation tool, a lead scoring system can be set up to add a point to the lead score based on the action of visiting the product page. If the lead New Lead Score = 0 Click on 2 Links +2 Visits 10 web pages +10 Score = 4 Score = 14 Does nothing for 90 days -1 Does nothing for 90 days -1 Score = 2 Score = 13 returns and visits the page again, the lead will then have 2 points, and so on. FIGURE 1 shows how a lead can add or lose points over time, depending upon positive or negative behaviors. Common reasons for adding to a lead score include: Open +1 Score = 1 Opening an Clicking on a link in an Visiting a web page Completing an online form Visiting the pricing page of your website Click on Link +1, Visit web site +1 Score = 2 Score = 3 Visiting a landing page Keep in mind that this point system is completely customizable. Your business or organization decides FIGURE 1. Lead scores change over time, with positive and negative which actions hold the most value for you and points are then assigned to reflect that value. You ll see how this works a little later on. FIGURE 2 shows an example of how a lead scoring rule is implemented. In the icontact Pro Lead Scoring module, the user is establishing a rule that adds a point to the score if the lead has commented on a Facebook post one time in the previous 5 days. Conversely, a lead can also lose points, for instance, by consistently not opening s over a period of time, or visiting your company s careers page (a signal that they might be interested in a job with your organization, not a purchase). Lead scores can also be created based on demographics or FIGURE 2. A social media-based lead scoring rule setup in icontact. location. Custom criteria could include: company size, job title, geography, gender, income, and previous engagement. 3
4 For example, a retailer specializing in women s shoes might automatically give every woman who registers with their site an immediate score of 10 if she lives within 5 miles of a retail location. Proximity means there is a greater likelihood of an in-store visit, and that lead is worth a little extra effort. A man living 25 miles away and registering on the site would get no points, initially. Nothing against him. He s just more of an unknown; he may be interested in making a purchase, perhaps for a wife or girlfriend, and may have serious buying intent, but he would have to demonstrate that with more positive online actions before he merits a designation as a hot lead. Lead scoring takes into account factors such as , social media and website engagement, along with other details such as job title, geography and demographics when evaluating the quality of your contacts. Lead scores can then be used to assign the type of content a subscriber receives or raise a flag to your sales team that the prospect is ready to be contacted about a specific product or service. How Does a Business or Organization Benefit from Lead Scoring? An organization benefits from lead scoring when its marketing team uses the lead scores to make campaign decisions. Otherwise, it s just another number. Assuming the marketing team sets up scoring parameters that are meaningful, with lead scoring, an organization can: Avoid wasting time and limited resources: Low-scoring leads do not deserve the most attention. You can keep marketing to them in the hope that they eventually convert, but your best efforts should focus on high scorers. Target campaigns: Scoring parameters can push up scores for targeted segments. For example, people who click a link and live in a specific zip code can be set aside for specialized messaging. Systematize and scale marketing: Once implemented, a lead scoring system can scale to handle large numbers of leads without time-consuming manual work. This capability helps a business grow without having to hire too many extra people. Demonstrate tangible marketing results: Defining success in marketing can involve abstract and subjective parameters. Lead scoring gives the marketing team a quantifiable way of showing exactly what they have done right. For instance, marketing might commit to generating 1,000 leads with a score greater than 100 in a month. Then, they will either meet the goal or not nothing abstract about it. Most Actions: Highest scores. Most qualified. Deserve the most marketing investment. Fewer Actions: Lower scores. Less qualified. Deserve some marketing investment. Little/No Actions: Low scores. Not qualified. Deserve little or no marketing investment. FIGURE 3. Lead scores should determine the level of marketing investment, with the highest scoring leads receiving the most resources. 4
5 The Marketing Qualified Lead (MQL) A lead scoring system allows a business or organization to better align the marketing and sales teams to work more efficiently together to achieve the ultimate goal: conversions Sales and marketing people may disagree about what exactly constitutes a qualified lead. Sales often wants a lead that is truly ready to buy. A Marketing Qualified Lead (MQL) is a lead that meets criteria set out by marketing, even if they are not actually pulling out their checkbook to make a purchase. One common practice is to establish a lead score threshold to be considered an MQL. Once a lead reaches the MQL score threshold, it can be turned over to sales for direct outreach. Ideally, this is accomplished through bi-directional sync with your CRM that makes the process automated and efficient. The practice of handing over only the highest scoring leads ensures that sales representatives invest time in contacting the most highly qualified leads. Lead Management Software A comprehensive Lead Management (or Marketing Automation) platform enables lead scoring to be implemented efficiently. Usually, the software provides a graphic interface where the user can set up if/then rules to assign lead scores in a workflow. The if/then rules are based on triggers. For instance, a trigger like clicks on might result in a point being added to the lead score. A good lead management software tool integrates with customer resource management (CRM) systems, making the lead reporting process seamless and automatic. For example, with icontact Pro, you can automatically send any lead that reaches your score threshold directly to your sales team via Salesforce to tell them that this lead is ready to buy. Scoring for an MQL may involve assigning higher scores to certain criteria. For example, if an organization is targeting leads in a specific industry, then a lead in that industry might get a 10-point bonus. This pushes a lead in the desired industry to the top of the highscoring pile right away for immediate sales attention. +10 The sync also works bi-directionally, automatically moving new leads and contacts from your Salesforce CRM to icontact Pro for marketing programs. Whenever a contact's record is changed in icontact Pro, the updated information is automatically pushed back into your Salesforce CRM so data remains consistent across both platforms. This keeps both the marketing and sales teams working in sync. Among B2B marketers, the #1 benefit of marketing automation is generating more and better leads.* Lead scoring should be part of any marketing automation platform you consider. *Pepper Global, Marketing Automation Trends Report
6 What to Look for in a Lead Management Tool Use this checklist to evaluate and compare different lead management tools in marketing automation platforms to make sure they have the features you need. Lead Scoring Checklist: Rules-based lead scoring Enables lead scoring based on social media activities Time-based lead score reduction Demographic/geographic scoring Bi-directional CRM integration List segmentation by score Part of a comprehensive marketing automation platform Remember: Too many leads can be as frustrating as too few. This is especially true when the quality of leads hasn t been properly ascertained. Red-hot opportunities can get left on the shelf to wither because the sales team is wasting its time with tire-kickers, and morale plummets when sales calls go nowhere. Lead scoring is designed to give your organization the best possible understanding of a business lead s potential and ensure any positive engagements are handled in a timely and professional manner. To learn more about lead scoring or to request a demonstration of icontact Pro, visit or call (877) ABOUT ICONTACT Since 2003, icontact has been offering comprehensive marketing solutions for businesses, nonprofit organizations, and educational institutions of all sizes. All our marketing products offer award-winning customer support, 600+ professional templates, and a reliable 97% inbox delivery rate. icontact Pro, our answer to the growing demand for marketing automation, takes marketing a huge step forward with workflows, lead scoring, landing pages, and more. It s the complete package to take your contacts on their journey from first interaction all the way through to marketing success. icontact.com/pro 6
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